When we initially speak to new companies we commonly hear, “Why would I need software to manage my close when it’s currently being managed in my ERP”?
It’s true that ERP solutions go some way to help with the various individual close processes, however, it’s also true that companies such as Siemens and Ingram Micro have ERPs but still wanted to improve their automation through the implementation of made-for-purpose R2R software.
Why? Because they weren’t happy with their current technology. They still struggled with all of the white space outside the ERP and were heavily reliant on spreadsheets and manual processes to manage their end to end Record to Report (R2R) processes and close their books. They all wanted to reduce the complexity of the close by automating their processes and close more quickly, for less money and with fewer resources.
Different companies, however, aren’t starting from the same place and we see a number of different landscapes when it comes to businesses’ ERP environments, including:
- Multiple different ERPs: Through acquisitions and legacy systems many companies have more than one type of ERP, whether these be SAP, Oracle, JD Edwards, etc. The challenge comes at month-end when companies try to pull together all the different close tasks and controls from the different systems, which all manage this information slightly differently. Historically, this means pulling it outside the ERP and working on it manually, often through the use of error-prone spreadsheets.
- Multiple Instances of a single ERP: Even when companies have a single ERP they will often have multiple instances which aren’t necessarily talking to each other. Again, different sections of the business will have different standards leading to inefficiencies, a lack of visibility, poor controls, and increased costs.
- A single instance of a single ERP: Even at ERP nirvana, the single instance of a single ERP, improvements can still be made. While all the information might now be in one place, the tools to effectively manage and coordinate the various activities, tasks and controls between the relevant individuals and teams are often missing, again leading to data having to be manually manipulated outside of the ERP itself and shared around the business in offline files.
So, what can be done to solve these challenges?
The analysts recommend a fully integrated solution that removes all these white spaces and offers a single view of your close. One that can integrate not only across your ERP landscape for consistent data management, but also across your whole financial close process, to offer a single view across the business, wherever and whenever.
As Gartner states, “When considering the automation and unification of critical financial processes, such as account reconciliations, compliance and Financial Close, the whole is greater than the sum of its parts. These activities are highly dependent on each other and, when unified, create new insights and return on investment (ROI) savings.”
For more information on how Record to Report technology can help make the most of your ERP investment, view our webinar recording, “Your ERP Is Just the Start: It’s Time to Close the Process.”